– Coinffeine launches today the worlds first decentralized Bitcoin exchange platform in more than 70 countries including Russia, China, Indonesia and Brazil.

– From day one, and only two months after the release of the Technical Preview version, Coinffeine achieves the largest international expansion ever carried out by a Bitcoin company.

– In November 2014, the company became the worlds first Bitcoin startup in having financial support of a large banking partner, the Spanish bank Bankinter.

Coinffeine has launched today the first decentralized Bitcoin exchange platform in more than 70 countries, among which are SEPA members, Russia, China, Indonesia and Brazil. Coinffeine achieves the greatest international expansion from day one ever carried out by a Bitcoin company.

Two months after the release of the Technical Preview version, where users have been able to experiment with the platform, Coinffeine now allows the exchange of bitcoins and FIAT money in a P2P way and in a global market.

Coinffeine offers a user experience similar to traditional exchanges, but using local payment processors – such as PayPal- to manage FIAT money and a desktop application to allow users to manage their own bitcoins without having to lose control over them at any time.

Coinffeine takes advantage of the P2P model to avoid accepting deposits in bitcoins or FIAT money, making it unnecessary to identify users or fulfill costly money laundering laws in each country.

“Not having to identify users or enforce KYC laws has allowed us to design a much more scalable exchange model. But what is even more interesting, is the user experience we offer. Coinffeine is like BitTorrent. You just download it, you connect your OKPAY account, or PayPal in the future, and use it”, said Alberto Gómez Toribio, CEO of the company.

Coinffeine success is in large part due to the support from solid partners such as Bankinter bank and the law firm Abanlex. The latter is known for winning the “Right to be forgotten” lawsuit against Google in Europe, and supports Coinffeine’s legal strategy in this world-wide launch.

Who is Coinffeine for?

“We want our customers to be those who simply have a PayPal like account and want to buy or sell bitcoins in a simple and effective way”, said Gómez.

For the moment Coinffeine only supports Okpay, a russian-based payment processor popular in the Bitcoin community and with 20% of its users in China. But Coinffeine expects to integrate other payment processors like PayPal or Alipay to expand services to the rest of the world in the near future.

The user experience that Coinffeine provides is very different from other P2P exchanges such as LocalBitcoins, and is closer to the experience of Coinbase or BitStamp.

“To use Coinffeine is as simple as using LocalBitcoins, but as powerful as using Coinbase or BitStamp”, said Gómez.

Coinffeine integrates the concept of a wallet and exchange in the same product, offering the first Bitcoin desktop wallet that includes the ability to buy or sell bitcoins automatically.

Limitations of the Beta version of Coinffeine

Coinffeine is still in Beta, so we recommend using moderate amounts of money.

Users of the Beta version could experience some limitations of liquidity available in the market. Coinffeine is negotiating with specialized companies to close liquidity deals and market surveillance to be added in future releases.

Just a year ago now, Coinffeine was one of the Bitcoin startups selected to participate in the CoinSummit in London. It was the first major international event in which we presented our proposal for a distributed Bitcoin exchange. This was shortly after we became the worlds first company to be established with bitcoins. Months later we had the opportunity to travel to Silicon Valley, being selected by the ICEX to participate in the first STC Immersionprogram. That trip coincided with the news that Bankinter invested in Coinffeine, becoming the first bank in the world to invest in a Bitcoin company. We returned to the United States, this time to New York, earlier this 2015. At that time Coinffeine was selected by the VentureOutNY to participate in its acceleration program. Days earlier, Coinffeine had organized a meetup in Madrid that launched the private testing of our Trial version. This week, just few days away from the release of our Beta in 70 countries, Coinffeine has once again been selected, along with four other Fintech startups, to participate in Finnovista Pitch Day, held in Madrid.

Alberto, our CEO, picked up the microphone once again to present Coinffeine to an audience of investors and financial industry professionals. And we will not deny that presenting at home and in Spanish, makes it all more real, closer and more unique. To be the first distributed P2P exchange that enables to buy and sell bitcoins is a milestone in the ecosystem. But not less important is the fact that Coinffeine is about to enter, from day one, in 70 countries. Our commitment to peer-to-peer technology was something highly valued in the event. It offers a replicable business model, and it makes an international expansion totally unknown in the Bitcoin industry a reality.

We understand these events as recognition of the work we do on a daily basis and a strong belief in our company. The direct contact with investors, mentors, personalities from the financial industry and other entrepreneurs, such as PayThunder, have accompanied the development of Coinffeine as a company and have helped us with feedback to outline Coinffeine’s future. A future that we believe is viewed as very promising by many.

One of the mentors of Finnovista Pitch Day was Antonio Herráiz Molina, who currently works as Director of Financial Innovation and Technology at the Instituto de Estudios Bursátiles (IEB) and BBVA (Digital Innovation Bank). Herráiz have said that Coinffeine “will soon become one of the Bitcoin startups of global benchmark. Its decentralized, open and secure technology means it has all the ingredients to become the reference exchange for bitcoins in several countries”.

The P2P nature of Bitcoin is changing the way users operate on the Internet and it is allowing the creation of more scalable businesses. However, few people can benefit today from P2P services to buy or sell bitcoins globally, in real time and with an automatic experience without resorting to forums as LocalBitcoins.

In many cases, the lack of P2P models limits users to perform operations on traditional exchanges, accepting costly validation processes due to AML legislations in each country. But even more unfortunate is that these services are available only in a few countries in the world, and excludes many of the markets with the greatest potential. This is because it is expensive for a traditional exchange to move into new markets, and because in many markets such as China, it is simply impossible. In most places in the world Bitcoin exchanges doesn´t exist beyond rudimentary forums that connect users through web pages. We intend to change this scenario, creating a global exchange with a model which, taking advantage of the P2P model, allows us to take our product to the whole world in an easy way.

The experience from an early user

For now, only a privileged few are those who have had the opportunity to test the Coinffeine Beta version with real money that Coinffeine plans to launch in the coming days. One of these users is Jorge Ordovás, Director of Innovation in Payment Systems in the business school in the Foro de Economía Digital and possibly one of the most experienced people in Spain in new means of payment such as Bitcoin. Jorge is one of the early users of the Coinffeine Beta version, and we wanted to talk to him about his experience with the application in the early trading with real money.

“To use Coinffeine has been a groundbreaking experience and a qualitative leap that allowed me, for the first time, to buy and sell bitcoins in real time without forcing me to take a “leap of faith” entrusting third parties to control my virtual coins”, says Jorge, and continues that “for several years I have been a customer of multiple exchanges, which allowed me to have a very broad view of the complexity, limitations and risks involved in buying and selling virtual currencies (Bitcoin, Litecoin, Nextcoin, Dogecoin …), due to the paradox of having to rely on third parties in an ecosystem that is essentially based on decentralization. And I’ve been in situations like the bankruptcy of MtGox, or thefts in Bter and Bitstamp, among others”.

Jorge has followed the evolution of Coinffeine closely and is one of the users who have tried all the versions of the application this far. At first he could experiment with the different versions of the Trial and the Technical Preview which, for security reasons, only allowed operations with no real money. Jorge has been testing our application with real money for several days, making operations and recording in the blockchain the first P2P exchange operations.

“The evolution of Coinffeine has been spectacular in many ways. The performance has improved considerably, as well as ease for installation and configuration, and many aspects of overall performance has been further refined”, Jorge explains about the work behind the user interface, “but where it really has been a before and after is in the complete redesign of the user interface, changing from an environment very oriented to the technical level of the solution to a much more attractive, intuitive and simple application aimed at the end user, which also includes custom functions for users of exchanges (as orders at market price)“, he adds.

The technical aspects that enable real bitcoins exchanges involves a change in the user experience of the application and Jorge says he has noticed “a difference in higher processing times, which is actually a feature of the real Bitcoin network against the testnet, which also affects the use of traditional exchanges”, he explains before concluding that, from his point of view “the experience is still much more satisfactory in general terms than these alternatives. The feeling of simplicity and the control over your bitcoins are stronger than these details”.

The blockchain’s block 360649 registered the first transaction carried out by two Coinffeine users with real money. Since last June 12th, a small group of users is testing the Beta version of Coinffeine, as prior step to its impending public release.

The transaction of 0.0549 BTC, verified at 21:47:13 last June 12th of 2015 recorded a Smart Contract between two users that has been created following the Coinffeine Protocol and it had enabled both parties to exchange fiat money by bitcoins in a decentralized manner.

For several weeks the Coinffeine’s development team will work closely with this small group of users to ensure that everything is ready for the Beta public release, in which users who choose so, will be able to start exchanging bitcoins and fiat money in a distributed and automatic way.

Coinffeine will operate in China and 69 more countries from day one

On the eve of the launch of the Beta version, we are pleased to announce that Coinffeine will be available from the first day in more than 70 countries. This is possible because Coinffeine uses local payment processors -companies as OKPay– to manage the fiat money, and the users will manage the bitcoins using the desktop application as a wallet. Coinffeine doesn’t require identification of the users, or to do a complex legal feasibility study for each of the countries where it will be operating, as our company does not manage money deposits or customer’s bitcoins.

The Coinffeine launch strategy aims to position our product in markets such as China, one of the countries where we will have presence from the day one, where traditional exchanges such as Coinbase or BitStamp cannot easily operate.

China proved to be one of the most active markets in late 2013, before the authorities banned the operations of Bitcoin exchange companies. Since then, Chinese authorities allow individuals to possess and exchange bitcoins particularly, but the operations of companies managing deposits of bitcoins (exchanges) are not allowed.

However, Coinffeine doesn’t accept bitcoin or fiat currency deposits and, even though the user experience is the same as with a traditional exchange, the exchanges are made P2P -among users- what it makes our product to fit perfectly into the Chinese market.

The data also shows that 20% of OkPay users come from China, so to try to differentiate ourselves in a market with almost no competition seems a good opportunity.

A replicable and scalable model

Being able to launch our product in more than 70 countries right from the start, simply is just aproof of the scalability of a model like Coinffeine.

Although we decided to start with those markets where there is a high potential and less competition, Coinffeine plans to integrate other payment processors like Dwolla or even PayPal at a very low development cost. Very soon we will be present in many more markets.

We are a start-up that wants to build a business model that is replicable and scalable. In Coinffeine we believe that taking advantage of P2P and decentralized technologies, such as Bitcoin, is the most natural way to achieve that.

Bitcoin can do magic with money. Because Bitcoin is not just money on the Internet that allows global peer-to-peer transfers almost instantly. Bitcoin is also programmable money. And Bitcoin also allows the digitally transfer of value. That value can be 10 euros, or an asset as a ship or a house. The title to any form of assets may be entered in the Bitcoin blockchain. If to this we add the ease of transfer, we can think about the next natural evolution: Bitcoin allows smart contracts.

A smart contract is an agreement between two or more parties -people or machines- that allows the creation of conditional terms or clauses (If this, then that) and allows them to run autonomously. With the development of these applications, the Bitcoin blockchain can become a system for the creation of programmable contracts between two or more parties. Several projects and companies in the ecosystem are already working in this direction. This includes Coinffeine that allows two people to exchange euros for bitcoins with smart contracts, or Oraclize, an Italian company that offers services based on smart contracts and has followed the footsteps of Coinffeine and was established using bitcoins as social capital.

The real world in Bitcoin Scripting

The language in which these smart contracts are written is not Spanish or English, but a language called Bitcoin Scripting, and has some peculiarities. Among them, it is not possible to create clauses that refer to external conditions. This limitation of smart contracts is partly remedied by a mechanism known as Oracle, at the expense of relying on a third party. Oracles are responsible for enabling a smart contract that incorporates clauses as “only if Real Madrid wins X match” or ” only if the oil price exceeds X value at X index.” This mechanism allows that the payment of a transaction is executed only if an external condition is met. So Oracles can therefore validate clauses that refer to external information. They are the third digital party that verifies and executes certain terms of the contract. We could say it’s like a notary who has the capacity to judge and see if certain conditions are met in the external world, but they cannot touch the money.

Oracles and reversible Bitcoin payments

The term Oracle was originally defined by Alan Turing and it has been adapted to Bitcoin by Mike Hearn. “Oracle servers” are companies that provide programming scripts through which we can define a logic to validate its service, allowing us to spend the money as we agreed. Thanks to the Oracles we can get a transaction to execute only if a certain external condition is met and define conditions for cases where it is not met. In addition oracles could make Bitcoin transfers reversible. It is well known that transactions with the cryptocurrency are irreversible, but if money is committed in a smart contract rather than in a current transaction, we can make any scenario possible.

As an example, imagine you buy a pair of sunglasses on the Internet and you agree that the seller will not get your money until you confirm that you have received the package. To do this, instead of sending the money directly to the seller, you create a smart contract. Once this is done, the seller can be sure you’re going to pay because he can verify that the money is committed is locked in a smart contract pending the courier company’s confirmation that the package has been delivered. This is done the delivery consultation on its website. When the application of the courier company confirms that you have received the package, the seller asks the oracle for the verification and it signs the transaction. Automatically the payment transaction that was blocked, is released and minutes after the seller receives the money you have paid for your sunglasses.

The interesting thing about this mechanism is that a trusted third party, the oracle, has authorized the payment, but it doesn’t require having access to the escrow: the oracle does not touch the money.

When Bitcoin is combined with real-world information is when “things start to get really interesting”, said Gavin Andresen on an analysis of this topic. We will have to see how oracle projects evolve in the ecosystem, but for now, they go in the right direction. And there seems to be no turning back.

This is getting interesting!

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Over a year ago, in February 2014, I talked about oracles and much more in a speech titled “Bitcoin Protocol for Developers” at the event T3chFest.

Oraclize (currently in Beta) offers services based on smart contracts providing Bitcoin transactions based on the occurrence of some verifiable real-life event, and is based on third-parties which were already acting as oracles, such as WolframAlpha or Football API, to link them to Bitcoin transfers.

One of the fathers of game theory, died together with his wife in a car accident last weekend. John Forbes Nash, aged 86, had just came back from Oslo where he collected the prestigious Abel Prize from the Norwegian Academy of Science and Letters for his mathematical work. Interestingly, 21 years ago now he also came back from Scandinavia with another prize. On that occasion he was awarded the Nobel Prize in Economics for his pioneering mathematical work in the 1950s. The prize recognized his work on the concepts of equilibrium in game theory.

His analyses in cooperative and non-cooperative games, known as the Nash Equilibrium, provide solutions to situations in which two or more parties interact to make decisions. His work have played since an essential role in the development of many branches of science, such as politics, biology, philosophy, computer science and of course economics.

“A set of strategies, in which no player acting alone can change your strategy to achieve a better outcome for himself,” is the definition devised by Nash equilibrium and has great importance in a situation where it does not exist trust between the parties, whatever its nature.

Coinffeine’s protocol allows decentralized exchange of bitcoins and has been developed based on Nash’ work and game theory as there is no trust between the parties and there is not a trusted third party. To exchange bitcoins and fiat money in Coinffeine both counterparties are matched automatically, without knowing who your counterparty is. This could have big risks if not for beautiful minds like Nash who have made this possible.

With the death of Nash, the world lost a genius. But fortunately his legacy will remain and the applications it may have, will be immortal.

As you know the Coinffeine’s Technical Preview has been ready for download from our website a few days now. As we explained on the download page, the opinion of the community is very important to us. All feedback and suggestions made by early Coinffeine users are analysed in detail by our developers, and where appropriate introduced in our roadmap of changes to be implemented.

The truth is that the answers received from the community so far, have exceeded our expectations. In just two days the application was downloaded more than 600 times, operations of purchase / sale have been recorded more than 2,000 times and we had more than 1,300 visits to our website. Specialized media such as Bitcoin Magazine, CryptoCoinsNews and Digital Money Times picked up the story, and in Spanish it was reports in OroyFinanzas.com, Sobre Bitcoin y Cripto Noticias. And even in Russia the launch of our Technical Preview had great impact after being published in Bit Новости. There is no doubt that the interest in our application motivates us to work tirelessly to develop Coinffeine so it becomes the distributed Bitcoin exchange the community expects and needs.

During these days of incessant activity in Coinffeine, where our development team has worked tirelessly to improve and implement difficult technical aspects, it has been a great help and a great honor to have the feedback from Mike Hearn.

It is a valuable reward to read this about our application, when the person behind these opinions is one of the most recognized developers in the Bitcoin ecosystem. But it is also a great responsibility, because it makes us even more aware of the enormous expectations placed on Coinffeine. Expectations that we do not only aim to satisfy, but to overcome.

We would like to thank the public reception of Coinffeine’s first days out there. And we would like you to know that our great little team works tirelessly to ensure that the first distributed Bitcoin exchange offers a unique and incomparable P2P exchange. And for that, your participation is crucial.

Have you already downloaded our app? Do you have any feedback or suggestions? What impressions do you have? Just tell us. Send an email to support@coinffeine.com. All your comments will make from Coinffeine a better platform for all.